The Trans-Pacific Partnership Agreement (TPPA) is a trade agreement between 12 Pacific Rim nations: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Viet Nam signed on 4 February in Auckland, New Zealand.

The condition for entry into force of the Agreement requires ratification by at least 6 parties accounting for 85% of the combined GDP of the 12 TPP members. The United States President Donald Trump signed an Executive Order to withdraw from the TPPA on 23 January 2017. Without US participation, the Agreement cannot enter into force. The US accounts for 60% of the combined GDP of the 12 TPP members.

In light of the US withdrawal, the TPP Ministers from the remaining 11 member countries convened a meeting on 21 May 2017 on the sideline of the APEC MRT Meeting in Hanoi, Vietnam and affirmed the economic and strategic importance of TPPA, particularly as a vehicle for regional economic integration. Negotiators from the 11 countries met over several rounds to find ways to implement the TPPA.

On 9-10 November 2017 in Da Nang, Viet Nam, Ministers of the 11 TPP countries reached an agreement on the core elements, the text of the agreement and way forward to implement the TPPA, which was renamed as the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP).

The CPTPP was signed by all 11 participating countries - Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Viet Nam - on 8 March 2018 in Santiago, Chile. Signing is an indication that the 11 countries accept the outcome of the negotiations and will start their domestic process to enable their ratification of the Agreement in order to bring the Agreement into force.

Entry into Force of the CPTPP / Implementation of the CPTPP

The CPTPP entered into force on 30 December 2018 for:

Australia

Canada

Japan

Mexico

New Zealand, and

Singapore;
and on 14 January 2019 for

Vietnam.

The CPTPP will enter into force for Brunei Darussalam, Chile, Malaysia and Peru 60 days after they complete their respective ratification process. This would mean that at this point in time, these 4 countries including Malaysia will not be able to enjoy the preferential tariff rates for members under this Agreement.

When will Malaysia complete our domestic procedures for ratification of the CPTPP?

Malaysia is still evaluating the Agreement and that we do not have a specific date for ratification.

The new Government has yet to decide whether Malaysia will ratify the Agreement or not, and the final ratification decision will be made by the Prime Minister and his Cabinet.

Snapshot: CPTPP Market
A market of 500 million people, and combined GDP of US$10 trillion

The CPTPP is a separate treaty that incorporates, by reference, the provisions of the original Trans-Pacific Partnership Agreement (TPPA). Under the CPTPP, signatories will implement the original TPPA between them, with the exception of a limited number of provisions which will be suspended. The CPTPP text should be read in conjunction with the text of the original TPPA.

A suspended provision is a provision in the original TPP Agreement which will not have effect under CPTPP. Twenty-two items from the original TPPA will be suspended under CPTPP. These suspensions will remain in place until the Parties, by consensus, agree to lift them.

It is important to note that the schedules and annexes specific to the United States as well as any reference to the United States that may appear throughout the Chapters of the original TPPA, will have no practical application as the United States is not part of the CPTPP.

In the context of the CPTPP, Malaysia has agreed on the following bilateral arrangements with a number of other CPTPP Parties on a range of issues. These are also sometimes referred to as - side letters.

The Commission, composed of government representatives of each Party at the level of Ministers or Senior Officials, is the highest decision-making body in any matter relating to the implementation or operation of the CPTPP.

The first CPTPP Commission Meeting was held in Tokyo, Japan on 19 January 2019 and the CPTPP Commission made the following decisions: